RBI MPC’s first dissent…

Today’s RBI MPC meeting resolution was on expected lines with one difference. Though, there was a dissent this time:

Five members were in favour of the monetary policy decision, while Dr. Ravindra H. Dholakia was not in favour. The minutes of the MPC’s meeting will be published by June 21, 2017.

Though, the decision is not disclosed. However, based on earlier Prof Dholakia work my guess is he would have argued for a rate cut.

In previous meeting there was almost a dissent as one of the members (Dr. Michael Patra) asked for a rate hike but chose not to dissent!:

sum up, I believe that a pre-emptive 25 basis points increase in the policy rate now will point us better at the target of 4 per cent to which the Committee has committed explicitly. It will also obviate the need for back-loaded policy action later when inflation is unacceptably high and entrenched. On balance, however, I vote for holding the policy rate unchanged in this bi-monthly meeting and await a few more readings of incoming data so that remaining transitory factors have passed and a clearer assessment of domestic and global macroeconomic conditions emerges.

The MPC minutes will be interesting to read..

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